Salary vs. Hourly: How to Convert Your Pay Rate (With 2026 Examples)

Quick Answer: How Do I Convert Salary to Hourly?

Divide your annual salary by 2,080 (40 hours/week × 52 weeks) to get your hourly rate. To go the other way, multiply your hourly rate by 2,080.

Example: $60,000 ÷ 2,080 = $28.85/hr

Salary vs. Hourly: Key Differences

Salaried employees earn a fixed annual amount divided into equal paychecks. Whether you work 38 hours or 48 hours in a given week, the paycheck stays the same.

Hourly employees earn a set rate for each hour worked. Your paycheck fluctuates based on the hours you log, and you’re typically eligible for overtime pay when you exceed 40 hours per week.

Side-by-side comparison

• Pay structure: Salary is a fixed annual amount. Hourly is a per-hour rate.
• Overtime: Salaried workers are usually exempt (no overtime pay). Hourly workers earn 1.5× their rate after 40 hrs/week.
• Income consistency: Salary is the same every paycheck. Hourly varies with hours worked.
• Benefits: Salaried positions typically include health insurance, retirement plans, and PTO. Hourly benefits vary by employer.
• FLSA classification: Salaried workers are usually classified as exempt. Hourly workers are usually non-exempt.

The terms “exempt” and “non-exempt” come from the Fair Labor Standards Act (FLSA). Exempt employees don’t qualify for overtime pay; non-exempt employees do. Your classification depends on your salary level, job duties, and how you’re paid.

How to Convert Salary to Hourly Rate

The standard formula uses 2,080 work hours per year (40 hours/week × 52 weeks).

Formula: Annual Salary ÷ 2,080 = Hourly Rate

Step-by-step example

1. Start with your annual salary: $60,000
2. Divide by 2,080: $60,000 ÷ 2,080 = $28.85
3. Your equivalent hourly rate is $28.85/hr

Quick reference: salary to hourly

• $30,000/yr — $14.42/hr
• $35,000/yr — $16.83/hr
• $40,000/yr — $19.23/hr
• $45,000/yr — $21.63/hr
• $50,000/yr — $24.04/hr
• $55,000/yr — $26.44/hr
• $60,000/yr — $28.85/hr
• $70,000/yr — $33.65/hr
• $80,000/yr — $38.46/hr
• $90,000/yr — $43.27/hr
• $100,000/yr — $48.08/hr

What about paid time off?

If your employer provides paid vacation and holidays, you still divide by 2,080. You’re compensated for those weeks, so they count as paid hours in the calculation.

How to Convert Hourly to Annual Salary

Reverse the formula to find the annual salary equivalent of an hourly rate.

Formula: Hourly Rate × 2,080 = Annual Salary

Step-by-step example

1. Start with your hourly rate: $25.00
2. Multiply by 2,080: $25 × 2,080 = $52,000
3. Your equivalent annual salary is $52,000/yr

Quick reference: hourly to salary

• $15/hr — $31,200/yr
• $18/hr — $37,440/yr
• $20/hr — $41,600/yr
• $22/hr — $45,760/yr
• $25/hr — $52,000/yr
• $28/hr — $58,240/yr
• $30/hr — $62,400/yr
• $35/hr — $72,800/yr
• $40/hr — $83,200/yr
• $50/hr — $104,000/yr

Part-time adjustment

Working fewer than 40 hours per week? Use this formula instead:

Hourly Rate × Hours Per Week × 52 = Annual Equivalent

Example: $25/hr at 30 hours/week = $25 × 30 × 52 = $39,000/yr

What Affects Your Actual Take-Home Pay

Converting between salary and hourly gives you gross pay — what you earn before deductions. What actually hits your bank account is your take-home pay, which depends on where you live, how you file, and what your employer covers.

Taxes

• Federal income tax: Varies by bracket, filing status, and W-4 settings
• State income tax: Ranges from 0% (Texas, Florida, Washington) to over 13% for top earners in California
• FICA: 6.2% for Social Security (up to $184,500 in 2026) plus 1.45% for Medicare

A $60,000 salary yields roughly $48,000 take-home in Texas (no state tax) versus about $45,500 in California. Same gross pay, ~$2,500 difference.

Benefits

Salaried positions often include benefits that don’t appear in an hourly rate comparison:

• Employer-paid health insurance (employers cover 70–80% of premiums on average)
• 401(k) match (typically 3–6% of salary)
• Paid time off, sick days, and holidays
• Life and disability insurance

These benefits can add 20–30% to the value of a salaried position. A $60,000 salary with $12,000 in benefits equals $72,000 in total compensation.

Overtime

Under the FLSA, non-exempt hourly workers earn 1.5× their regular rate for every hour over 40 per week. That $25/hr becomes $37.50/hr for overtime hours.

A $52,000 salary and $25/hr look equivalent on paper. But add 5 hours of overtime per week, and the hourly worker earns an extra $9,750/year ($37.50 × 5 × 52 weeks), bringing their gross to $61,750.

Use our Paycheck Calculator to see the actual take-home pay for your specific salary, state, and deductions.

Salary vs. Hourly: Which Pays More?

There’s no universal answer. The better option depends on your job and what you value.

When salary tends to pay more

• The position includes strong benefits (health insurance, 401(k) match, PTO)
• You regularly work over 40 hours but wouldn’t earn overtime as an hourly worker in your field
• Income stability matters more than maximizing short-term earnings

When hourly tends to pay more

• Overtime is consistently available and you’re willing to work extra hours
• The hourly rate is high enough that base pay plus overtime exceeds the salary offer
• You value clear boundaries: clock out, and your time is your own

How to compare a salary offer to an hourly rate

1. Convert to the same unit. Use the formulas above to express both as annual or hourly figures.
2. Add benefits. Estimate the dollar value of health insurance, retirement match, and PTO for the salaried position.
3. Estimate overtime. Be realistic about how many extra hours the hourly position actually offers.
4. Factor in state taxes. If the jobs are in different states, the same gross pay can yield different take-home amounts.
5. Calculate take-home pay. Use a paycheck calculator to model both scenarios after taxes and deductions.

2026 Salary vs. Hourly Conversion Examples

These examples show approximate figures using 2026 tax rates. Your results will vary based on filing status, state, deductions, and W-4 settings.

Frequently Asked Questions

Tips for Comparing Salary and Hourly Pay

• Always compare total compensation, not just base pay. Employer-provided health insurance, 401(k) matching, and PTO can add 20–30% to the value of a salaried position.
• Factor in overtime realistically. Some hourly positions rarely offer overtime; others consistently provide 5–10 extra hours per week. Base your comparison on actual, typical hours.
• Use gross pay for conversions, net pay for budgeting. The ÷ 2,080 formula gives you gross figures. For what you’ll actually take home, run the numbers through a paycheck calculator.
• Recalculate when you change states. A $60,000 salary produces very different take-home pay in Texas (no state tax) versus New York or California.
• Check your effective hourly rate. If a salaried job regularly requires 50+ hours per week, divide your salary by actual hours worked to see what you’re really earning per hour.

References

• DOL Overtime Pay Requirements (FLSA) — Federal rules on overtime eligibility, the salary threshold, and the 1.5× overtime rate.
• IRS Publication 15 (Employer’s Tax Guide) — Official IRS guidance on federal tax withholding, FICA rates, and wage calculations.
• Bureau of Labor Statistics — Occupational Employment and Wages — National and state salary data by occupation for benchmarking pay rates.